Correlation Between Ford and Digjam
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By analyzing existing cross correlation between Ford Motor and Digjam Limited, you can compare the effects of market volatilities on Ford and Digjam and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ford with a short position of Digjam. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Digjam.
Diversification Opportunities for Ford and Digjam
Significant diversification
The 3 months correlation between Ford and Digjam is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor and Digjam Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digjam Limited and Ford is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ford Motor are associated (or correlated) with Digjam. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digjam Limited has no effect on the direction of Ford i.e., Ford and Digjam go up and down completely randomly.
Pair Corralation between Ford and Digjam
Taking into account the 90-day investment horizon Ford Motor is expected to generate 0.96 times more return on investment than Digjam. However, Ford Motor is 1.04 times less risky than Digjam. It trades about 0.05 of its potential returns per unit of risk. Digjam Limited is currently generating about 0.03 per unit of risk. If you would invest 1,072 in Ford Motor on August 25, 2024 and sell it today you would earn a total of 46.00 from holding Ford Motor or generate 4.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.56% |
| Values | Daily Returns |
Ford Motor vs. Digjam Limited
Performance |
| Timeline |
| Ford Motor |
| Digjam Limited |
Ford and Digjam Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Digjam
The main advantage of trading using opposite Ford and Digjam positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford position performs unexpectedly, Digjam can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Digjam will offset losses from the drop in Digjam's long position.The idea behind Ford Motor and Digjam Limited pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Digjam vs. Gujarat Raffia Industries | Digjam vs. Kingfa Science Technology | Digjam vs. Rico Auto Industries | Digjam vs. GACM Technologies Limited |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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